- Firms can make applications from January 1, 2019
- Companies will have to follow very strict guidelines to receive the license
- The initiative is a step forward for the fledgling cryptocurrency industry
Legitimacy for blockchain and crypto-related businesses operating in Switzerland is just around the corner. The country’s financial regulator will now allow them to accept up to $100 million deposits, a figure that has previously only reserved for banking institutions.
Switzerland Continues its Strides in the Cryptosphere
The decision to allow blockchain and crypto-related firms to apply for the new Fintech license is contained in guidelines provided by the Swiss Financial Markets Supervisory Authority (FINMA) through an official December 3, 2018 press release. The country’s financial regulator says companies interested in the license can file their applications with the authority beginning January 1, 2019.
The authority will require the companies seeking the Fintech license, which FINMA calls “relaxed requirements,” to adhere to the strictest guidelines that are included in the terms of the license.
The prerequisite for receiving the coveted license includes being able to provide several details such as the firms Fintech project, business description and financial plan, asset storage methods, risk management, and anti-money laundering (AML) policies. FINMA will also require full accountability of firms’ board members including their addresses, educational records, CVs and criminal records and references from former employers. The release also states:
“The Fintech license allows institutions to accept public deposits of up to CHF 100 million, provided that these are not invested and no interest is paid on them. A further requirement is that an institution with a Fintech license must have its registered office and conduct its business activities in Switzerland.”
The Fintech license document is contained in a document dubbed “Guidelines for Fintech License Applications Pursuant to Article 1b of the Banking Act” that has been in the works since February 2018 will be officially adopted on January 1, 2018.
Early last month FINMA issued the country’s first crypto license that targets crypto asset investment funds. The license enables crypto-related companies to provide several investment services including tracking Bitcoin and other crypto assets and domestic funds. The financial regulator has also previously given guidelines that regulate Initial Coin Offerings (ICOs) as a way to boost the adoption of the blockchain technology.
The new initiative is seen an important step forward for the Swiss cryptocurrency industry especially those operating from the “Swiss Crypto Valley” in ZUG, the prominent tax haven set aside for new blockchain businesses.
Switzerland is trailing the blaze and pushing boundaries for the cryptocurrency industry, having made history for being the first country to approve the trade in Bitcoin-based Exchange Traded Fund ahead of leading economies like the United States.